We should sell NZ Post while we can

The Herald reports:

New Zealand Post will stay Government-owned, says Finance Minister Bill English, after news it is axing up to 500 jobs over three months.

The planned cuts, announced yesterday, form part of the 1500 to 2000 job losses signalled at the end of 2013.

“New Zealand Post can confirm it is about to enter a period of consultation with, predominantly, managers and specialists at head office and in support roles. The roles are mainly in Wellington, Auckland and Christchurch,” a spokesman said yesterday.

Commenting on the news, English said NZ Post was adjusting to the reality of falling letter volumes and “working out how to become a bit more of a logistics company”.

Asked by reporters if the Government wanted to own a logistics company, English said: “It’s Government-owned, we’re going to be keeping it, so they’ll have to find a solution.”

Despite the very good management, NZ Post has a bleak future as it is selling horse and carriages in a motor vehicle world.

The Government should sell it, while it can.

UPDATE: Liam Dann agrees:

The time has come to split Kiwibank from its parent NZ Post and sell them both.

Kiwibank is ripe for partial privatisation. If the Government floated 49 per cent on the NZX it could net $750 million and deliver the company some much needed capital to grow and boost its profitability. …

NZ Post is politically more difficult and splitting Kiwibank out of the business would leave it vulnerable.

To make the split work the Government needs to really bite the political bullet and sell NZ Post too.

As evidenced by the latest large scale job cuts, the business is facing disruption a scale that threatens its very future. The business of letters is dying fast and the business of parcels is already fragmented and highly competitive.

It should be sold completely, while it is still worth something. Its best long-term option is to be part of an industry consolidation and taken over by a bigger freight and logistics company.

I like that idea – sell 49% of Kiwibank and 100% of NZ Post.

We should also sell TVNZ while it is worth anything. In a decade or two NZ Post and TVNZ will probably resemble Solid Energy!

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